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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (27832)	2/6/1999 6:19:00 PM
From: ArtAlley	Respond to of 116837

To: long-gone who wrote (27832)	2/6/1999 6:41:00 PM
From: ArtAlley	Respond to of 116837

Y2K...a historical 'perspective'... When we were in Europe a few years ago, while digging through some ruins, I came across a letter that I didn't think was particularly interesting at the time. While I paged thorough some of my souvenirs, I realized that it might have more significance today than I originally thought. Tell me what you think. Here's the exact wording of the letter: Rome January 6, 1 BC Dear Cassius, Are you still working on the Y Zero K problem? This change from BC to AD is giving us a lot of headaches, and we haven't much time left. I don't know how people will cope with working the wrong way around. Having been working happily downwards forever, now we have to start thinking upwards. You would think that someone would have thought of it earlier and not left it to us to sort out at the last minute. I spoke to Caesar the other evening. He was livid that Julius hadn't done something about it when he was sorting out the calendar. He said he could see why Brutus turned nasty. We called in the consulting astrologers, but they simply said that counting downwards using minus BC won't work. As usual, the consultants charged a fortune for doing nothing useful. As for myself, I just can't see the sand in an hourglass flowing upwards. We have heard that there are three wise guys in the east working on the problem, but unfortunately they won't arrive till it's all over. Some say the world will cease to exist at the moment of transition. Anyway,we are continuing to work on this blasted Y Zero K problem, and I willsend you a parchment if anything further develops. Vale, Plutonius

To: long-gone who wrote (27832)	2/7/1999 9:05:00 AM
From: John Hunt	Read Replies (3) \| Respond to of 116837

Leasing of gold and silver Hi Richard, I thought you would enjoy these two very educational gold and silver posts by Rhody on the Gold Eagle forum. Put your thinking cap on. < g > I would have posted a link, but the posts rapidly become historical and hard to find. John First Post I strongly advise the Gold Forum members to monitor gold and silver lease rates on a day to day basis. Lease rates forecast the recent silver spike by a good twelve hours. A reliable link for lease rates is mitsui-gold.com Click on New York Commentary. One month lease rate spikes indicate a short attack on the metal concerned if the spike is not across the board. Across the board spikes indicate a pronounced shortage in liquidity in the concerned metal with near term spot price increases. Surges in the one year rates indicate hedging activity by producers with negative near term implications for spot prices. Lease rates are the most visible phenomena associated with the gold and silver carry, a practice which has been the most destructive of the many manipulations perpetrated by Central Banks and Wall Street. The economics of the gold/silver carry are simple: Gold carry profit rate = TB (t) - [LR (t)- I ] where TB = Treasury Bill rate LR = Lease rate I = Inflation rate t = term of lease or t-bill. So If the present one month gold lease rate is .89% and one month t-bills are 4.5% and the inflation rate is 2.0%, then the calculation is Profit rate = 4.5% - .89% - 2% = 1.61% (annualized) To add icing to that profit rate, when leased gold is sold (shorted), then repurchased to return, it is usually at a lower price, so that even in a one month period, the shorting profit has widely exceeded the profit from the T-bill sale. This became such a common practice that the shear weight of shorting by leasers has guaranteed the inevitable short as profitable, and gold has been leased to death over the past 12 years in a practice now labelled the 'gold carry'. There is a silver carry, and complaints by principles in the London Metals Exchange concerning leasing of metals causing aberrations in that market, suggest the leasing scam has spread to other commodities. This practice causes deflation, and only deflation. Since commodities are priced in US dollars, the leasing scam has much to do with the artificial strength of this currency, at the expense of deflating the economies of every other nation which exports physical goods into international markets. Taken in this light, leasing may be an attempt by the US government to perpetrate a kind of financial imperialism on the world, leading to the Asian Crisis, and later the Brazilian Crisis. The names are attempts to project. This is a dollarization crisis, and it leads to collapse, and deflation, soon to come to a neighbourhood near you, even in the United States. Got gold? Oh yes, one might add, does this always end in a deflation? No. Deflation results as long as there are any stockpiles of a commodity available for leasing. When the stockpiles are gone, the combination of short overhang, plus deflated supplies lead to a giant price explosion and fund defaults as years of postponed and warranted price increases all occur over a matter of months. In the case of a commodity where substitution is impossible, the eventual price explosion may last for years. Got Silver? Please forgive the length of this post, as I do not post over here very often. Have a good weekend. Second Post There is one other way for the leasing scam to end, not in price explosion, and not in deflation, but just end. If the leasing profit becomes zero, then the participants tend to cease leasing. This happens when inflation rises to the point that it reduces the profit rate to zero. In our case, the inflation rate need rise only by 1.61% to 3.61% from the present 2%. On the other hand, lease rates could rise by 1.61%, and that would do it, or interest rates could fall by 1.61%. Ask yourself this question, if the world is threatening to deflate, what is the Federal Reserve Board most likely to do, raise or lower interest rates? I have heard economists say that interest rates may be as low as 2% by the end of this year or next. That's 2.5% lower than present rates. That would kill the leasing scam. Unless you were a hedge fund with exposure to 100 million ounces that you borrowed, and you did not want to buy it all back on the spot market, and raise the spot POS. You would be tempted to release (roll over your leases) despite the lack of profit rate, just so you didn't cause a spike in the spot market, that would attract speculative longs and make it more difficult for you to eventually cover. Rhody